# please answer this files as well as this: attached references and excel as required Connecting the dots Part A: Using examples, explain following “ in terms of how these are used for financial

attached references and excel as required

Connecting the dots

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Part A:    Using examples, explain following  “ in terms of  how these are used for financial planning”.

(30  % of this assignment)

a.     Asset allocation

b.     Rule of 100

c.      Dollar averaging

d.     Fund expense ratios

e.     Fund Standard deviation

f.      Fund Beta

g.     Portfolio beta

Part B:  Planning problems using Excel

1.     Mortgage payments : ( 10 % of this assignment)

·       Loan amount : \$200,000

·       Interest rate (annual): 4.00 %

·       Term : 30 years

·        Calculate

i.     monthly payments:  ( Hint : Rate and number of periods should be adjusted for monthly)

ii.     Total  interest amount over the life of the loan

2.     In reference to (1, above).  ( 10 % of this assignment)

a.     Calculate PMT ( Monthly payments) if you want to pay of the above loan in 20 years

b.     How much less interest will you pay  over the life of the loan ( versus paying in 30 years)

3.     Mary is 30 years old and has \$ 20,000 in her investment account equally spread in two funds and plans to add additional \$ 2000 in each fund. ( 10 % of this grade)

·         Fund A :

i.      Current amount : \$ 10,000

ii.       Historical performance , 10 year average : 6.5 %

·         Fund  B  :

i.      Current amount : \$ 10,000

ii.       Historical performance , 10 year average : 5 .5 %

·         Calculate ( using 10 year average performance) amount in each fund, and total portfolio  at      end of 10 years, 20 years and 30 years

4.     Jane is 40 years old and has \$ 50,000 in her investment  account equally spread . And she plans to put in \$ 2000 every  year in each of the two funds .  (15 % of this grade)

·       Fund A :

i.     Current amount : \$ 25,000

ii.     Historical performance , 10 year average : 8.5 %

iii.     Fund beta : 1.2

·       Fund  B  :

i.     Current amount : \$ 25,000

ii.      Historical performance , 10 year average : 4 .5 %

iii.     Fund beta : 0.5

a.     Using ten year average performance, calculate amount in each fund, and total portfolio  at end of 10 years, 20 years and 30 years

b.     Calculate portfolio beta at 10 year, 20 years and 30 years  ( Hint : Portfolio beta  is weighted average beta . Covered in Std deviation and Beta lectures…. recorded lecture for Beta)

5.     Calculate Bond price; ( 10 % of this assignment )

a.     Par : \$1000

b.     Yield maturity : 6.0%

c.      Term left till maturity : 22 years

d.     Coupon rate : 5 %

e.     Bond Price : ?

6.     In reference to above ( # 5) ( 5  %  of this assignment)

7.     Calculate Bond Yield to maturity RATE ( 10 % of this assignment) )

a.     Bond Price : \$ 1050

b.     Par : \$ 1000

c.      Term to maturity 22 years

d.     Coupon rate : 4 %

e.     Yield to maturity Rate : ?

please answer this files as well as this: attached references and excel as required Connecting the dots Part A: Using examples, explain following “ in terms of how these are used for financial
Mary has a total of \$100,000. She is thinking of investing most of it, and keeping some as cash. She wants her money to grow and realizes that in order to get a return she will have to take some risk and invest in stocks and or mutual funds that will have stocks and or bonds. Her financial advisor recommended: one individual stock, three funds, and rest in cash. Based on the historical average growth rate the financial advisor forecasted her portfolio for the next ten years. Mary prefers a bit more conservatism in her portfolio and suggested more in cash and a different mix Her advisor provided her the analysis for the first set of scenario. And started the second scenario but was not able to finish. Please complete the forecast for Mary using Excel. In Canvas an excel sheet is provided. The first tab has the “only the answers,” no formulas for the top scenario. For the second scenario calculations, answers (no formula) are provided for first two years. Assignment: Complete the forecast rest of the years. In order to confirm if your model is working, apply it to the first scenario to see if you can replicate the answers. Hint on Average return for the portfolio ( 4.69 % for the first scenario): It is not arithmetic average ; use “RATE” formula in excel.